All bets are off for gambling firms as the increased focus on ethics is forcing the industry to change its business model.

The digitalisation of betting changed the face of gambling, allowing gamblers to click on an app to bet on sports events or casinos at any time of the day or night.

The tantalising risk involved in online gambling has proven to be as addictive and as destructive as alcohol and drugs.

Changes in technology brought phenomenal growth in revenues and returns, but it came at a cost to the most vulnerable.

Barry Grant, an addiction counsellor with Extern Gambling Ireland, works with people whose lives have been devastated by a gambling addiction.

"We would work with people who are gambling 16, 17, 18 hours a day, gambling through the night and into the morning and trying to do a day's work afterwards," he said.

This online business model has been under close scrutiny, and the industry is preparing for change.

They are being forced to change, according to Mr Grant.

"They have had ample opportunity to do this for at least 10 years in the online gambling space and they haven't. They're reacting to impending legislation from what I can see."

Applications opened this week for the chief executive of the Gambling Regulatory Authority, which is to be established under the new Gambling Regulation Act.

It is envisaged the bill will include spending limits, ban free bets and VIP schemes, stop credit card use, stronger age verification for online gambling and enforce new rules on advertising.

It follows the first report on gambling trends by the Health Research Board which estimated that there are 12,000 problem gamblers in Ireland; people who gamble with negative consequences and a possible loss of control.

The same survey estimates that there are 35,000 "moderate-risk gamblers".

"In terms of the profile of at-risk or problem gamblers, commonly, it is men aged 25–34 who are living in a deprived area, are unemployed and experience substance use problems such as drug use, an alcohol use disorder or smoking," said Dr Deirdre Mongan, lead author of the report.

The issue of problem gambling is not a good look for the gambling industry. The reputational damage is huge and it is off putting for investors.

It has taken a long time, but gambling firms are paying attention and preempting new laws to regulate the industry.

On Tuesday, Flutter Entertainment posted an 11% fall in 2021 earnings, sending shares in the world's largest online betting firm down.

While the easing of lockdowns lowered demand according the owner of Paddy Power, Betfair and FanDuel, it also cited regulatory changes and increased spending on initiatives to curb gambling addiction for the dip in earnings.

Flutter revealed that it has spent £93 million in 'safer gambling costs' in 2021. CFO, Jonathan Hill, told an analyst call that a whole range of measures added up to the £93m sum.

"We have been putting in lower thresholds. We've undertaken daily deposit limits for all customers. Actually the £10 staking limit on slots has been a very small portion of that. It has been the general multitude of actions that we have taken across a whole range of areas."

Flutter CEO, Peter Jackson said he recognised that the changes the firm is making are having a financial impact on the business, "but I passionately believe that what we are doing is right for our customers and right for our business in the long term.

"Ultimately this means that if the UK sector experiences a year or two of low growth then it will be a price worth paying in the interest of all stakeholders."

The day before it published its results, Flutter announced that it will tie 10% of annual bonuses for its staff to initiatives aimed at helping prevent gambling addiction.

The targets were part of a package aimed at getting 75% of active online customers to use at least one of its safer gambling tools by 2030.

Restrictions introduced by the UK Gambling Commission tend to spill over here.

The UK regulator imposed a credit card ban last year, and it was voluntarily introduced in Ireland with members of the Irish Bookmakers Association rolling in behind it.

BoyleSports has signed up to the IBA Code of Practice, and said customers in Ireland would be better protected if such a code were mandatory for all bookmakers and other gambling companies operating in the Irish market.

"Aside from the benefits of having all gambling companies regulated uniformly, many initiatives and safeguards that would serve to offer greater protection to customers, which are already established in other well-regulated jurisdictions, can only be brought in by a regulator," said Mark O'Neill, CFO of BoyleSports.

"These include establishing a national register for people for whom gambling has become a problem to allow them self-exclude from all gambling activity and requiring financial institutions to prevent credit cards from being used to place a bet," he added.

Extern Gambling Ireland is calling for mandatory spending limits, similar to that of the Irish National Lottery's online platform.

"There is precedent for that," Mr Grant said.

"They wouldn't be coming up with something completely out of the blue, and the lottery products are much, much milder than online sport betting or online casino products like blackjack and roulette and slot machines.

"I can't see why we couldn't have them in place for the harder much more addictive products."

The addiction counsellor would also like time limits on online gambling introduced, again similar to that of Irish National Lotteries which closes overnight.

He is looking for "some sort of a break" so that people couldn't gambling for hours on end through the night.

James Buckley, Senior Equity Analyst with Cantor Fitzgerald said gambling firms are "trying to get ahead" of the impending legislation which is "going to make it less profitable for gambling companies to operate in the UK and Ireland".

He is not sure if the changes will make investors view betting companies more favourably.

"There are more questions that are being asked about everything you invest in now. Some of those questions can be quite awkward," he suggested.

"The charities for problem gamblers are quite effective at getting their message into the media about the problems of gambling."

Mr Buckley said, "If there was a legislative framework to reduce the number of problem gamblers, then it might at the margin allow some investors who would like to invest to come in from the sidelines."